Sensex falls for 9th straight session, pharma stocks drag
BENGALURU: Indian shares closed weaker for a ninth straight session on Monday, dragged by financial and pharmaceutical stocks, as concerns over the country’s non-banking finance sector (NBFC) coupled with global slowdown worries whacked investor sentiment.
NBFC sector is facing issues of credit squeeze, over-leveraging and misadventures by some large entities, corporate affairs secretary Injeti Srinivas told the Press
Trust of India on Sunday. “Initially, investors bought shares at a low valuation expecting a recovery, but it didn’t (recover) and that is why we saw a heavy sell-off at the end,” said AK Prabhakar, head of research, IDBI Capital in Mumbai.
The benchmark BSE index ended down 0.99% at 37,090.82. The broader NSE index closed 1.16% lower at 11,148.2.
The NSE records its longest losing streak since May 2011, while the BSE index matched its worst run in about two months.
Nifty’s state-run bank index closed 5% lower with Union Bank of India Ltd ending 9.76% weaker.
US states filed a lawsuit accusing Teva Pharmaceuticals USA Inc of orchestrating a sweeping scheme with 19 other drug companies to inflate drug prices, state prosecutors said on Saturday.
The pharma index closed 4.37% weaker, with Sun Pharmaceutical Industries Ltd marking its worst session in nearly two years.
Index heavyweight ITC Ltd closed 2.84% after posting its March-quarter results.
Other top Sensex laggards were Yes Bank, Tata Steel and IndusInd Bank—falling as much as 5.58%.
After trading range-bound for most part of the day, the 30-share BSE benchmark saw steep plunge in the last hour and closed 372.17 points lower. The index hit an intraday low of 36,999.84 and a high of 37,583.57.
Similarly, the broader NSE Nifty sank 130.70 points. During the day, the NSE gauge hit a low of 11,125.60 and a high of 11,300.20.
Among the gainers on the Sensex, HDFC topped the chart, rising 1.06%, after the mortgage lender posted a 26.8% rise in its stand-alone net profit at ₹2,862 crore for the fourth quarter ended March 2019.
Hindustan Unilever Ltd (HUL), Infosys, Bajaj Finance, Coal India and Hero MotoCorp rose up to 0.87%.
Domestic investors kept weighing weak cues from global markets amid uncertainties around US-China trade tariff deal. Also, sustained foreign fund outflows kept investors edgy.
Foreign institutional investors (FIIs) net sold equities worth ₹1,056.01 crore on Monday, while domestic institutional investors (DIIs) purchased shares to the tune of ₹1,057.91 crore, provisional data available with stock exchanges showed.
Bourses in China, Japan and Korea ended in the red tracking news related to US-China trade talks.
The US has recently announced hike in duty on import of Chinese products worth more than $200 billion.
China has said that Beijing would not compromise on matters of principle and that tariffs on Chinese exports to the US should be lifted as a condition for striking a deal.